The average person spends £1,500 on Christmas - how can we afford it?
The average Brit is set to spend £1,500 on Christmas celebrations this year. A survey asked people to put a price on various things from gifts to parties and special outfits, and came up with this astonishing total. But the sheer scale of the spending is not the most worrying thing about this statistic.
The figures came from American Express, who asked people what they expected to spend on Christmas, and found that people will blow an average of £315 on gifts for their loves ones and £104 on throwing parties - among a host of other costs.
It's a huge sum of cash, but what's even more worrying is that there's every sign that these figures are just a random stab in the dark. A separate study from Experian asked people what they planned to spend this Christmas, and they came up with a figure of £923. That includes £403 on Christmas presents and £58.68 on Christmas-related impulse purchases.
What's going on?
Both surveys identified the problem: people don't set a budget. It means that they're not referring back to the sensible sum they have set aside for each item - they're plucking figures from the air. Amex found that just 33% of people have a sensible budget for Christmas, while 28% have no idea at all of what they plan to spend - and everyone else falls somewhere in between.
Unsurprisingly, as a result the Experian research found that 13 million people will fall into the trap of overspending, so a third will then have to borrow money to pay for Christmas. On average people will put 14% of their Christmas spending on credit cards and 7% on overdrafts. The average person then takes three months to pay off their festive debts, taking them through to Easter - while one in seven will still be paying it off in June next year.
Both these studies reveal exactly what kind of trouble we can get into if we blindly blunder into Christmas spending. If you are yet to get stuck in, therefore, you have a small window of opportunity to do things right.
The first step is to actually set a budget - broken down into types of spending like gifts and food - and then broken down again by person or meal so you know you're not overspending on wine for New Year or Aunty Joan's slippers.
Ideally your budget will be based on money you have already saved for Christmas, or an inexpensive Christmas based on one month's salary.
If you really do need to borrow, there's a right and wrong way to do it. James Jones from Experian explains: "People who plan to spread the cost of Christmas using credit should seriously consider exploring better deals on credit cards, such as 0% promotional interest rates and reward cards, using cash-back sites and, of course, searching for the best deals online."
However, he adds: "If you're spending on credit over the Christmas period, set yourself a strict budget and make sure you can afford to pay back what you borrow. Missing payments in the New Year because you've overspent could hurt your credit score, affecting your chances of getting credit you need in the future and making any credit you are offered more expensive."
The second step, of course, is to stick to that budget. Sarah Willingham, Ambassador for American Express says your best bet is to keep a list of everything you spend, so you can keep track of how close you are to busting your budget.
If you have far too many people to buy for, then it's worth sorting sooner rather than later, Willingham suggests: "Why not consider splitting the price of a gift between friends or family? That way the person can receive the item they really want, without one person needing to spend lots of money."
It's also possible to take advantage of bargains and cashback as long as you don't get carried away. Willingham points out that if you're not meeting up with groups of friends until after 25 December, you could even wait to buy them something in the Boxing Day sale.
Top ten facts about Black Friday
Top ten facts about Black Friday
Discover More Like This
BACK TO SLIDE